Silicon Valley Needs to Lose the Arrogance or Risk Destruction

Christoph Niemann

When an industry has a hold on the public imagination, it’s easy to forget just how fickle that imagination can be. By 1946, when women were nearly rioting to get their hands on scarce pairs of nylon hose, plastic had emerged not merely as an enormous business but as the very stuff of dreams, a substance poised to shape the American future. Soon after, plastic spurred visionary industrial designers toward entirely new forms, dramatic curves and swoops that would have been impossible in a preplastic age. Twenty years later, though, the love affair was over—a reversal captured in a famous scene from 1967’s The Graduate, when Dustin Hoffman’s dissolute title character receives some career advice from a family friend: “I just want to say one word to you. Just one word. Are you listening? Plastics.”

Unlike any other industry, tech relies on not merely trust but faith that a leap into the unknown will be rewarded.

It was a savagely ironic line, and not because plastic use had declined (it hadn’t) or because plastics firms were bankrupt (they weren’t) or even because plastic had become widely known as an environmental disaster in the making (it hadn’t quite, yet). The irony ran far deeper than that: To a sophisticated audience in 1967, “plastic” had come to stand for everything wrong with the culture, for what Tom Wolfe would soon call the “poor old Formica polyethylene 1960s America,” with its superficiality, its acquisitive domesticity. This new generation had heard all about the marvelous plastic future, and they wanted no part of it.

Since the late 1970s, we’ve dreamed in silicon, not plastic. From the personal computer to the MP3, from the Internet to the smartphone, a seemingly unending stream of computer-based innovations has kept Silicon Valley aloft not just in profits but in the public imagination.

But by the waning days of 2013, when protesters smashed a window of a Google commuter bus in Oakland, California, it seemed as if the psychic bond with Silicon Valley might be fraying. There was the shock over revelations that the National Security Agency had used “backdoors” at the data centers of tech giants to siphon off private communications. There was the outrage at Uber, the venture-backed car service, over its practice of using “surge prices” during peak demand to charge seven or eight times the normal rate.

When Silicon Valley Comes to Stand for Everything Wrong with the Culture

In the Bay Area, where tech salaries and IPO riches have pushed the cost of living to the breaking point, the rancor cut deep on subjects ranging from Twitter’s sweetheart tax breaks to working-class families displaced from local neighborhoods.

As the rest of the economy struggled, tech bigwigs repeatedly proved themselves to be out of touch, whether it was Facebook cofounder Sean Parker’s lavishLord of the Rings-inspired wedding or mega-VC Vinod Khosla’s privatization of one of California’s historically public beaches.

It’s all adding up to a nasty picture of Silicon Valley—of an industry that hoovers up personal data and reaps massive profits from its use, preaching a gospel of sharing but refusing to share back. The criticism has become so pronounced that even The Wall Street Journal and The Economist, hardly bastions of anti-corporate activism, have taken to warning (respectively) about Silicon Valley’s “arrogance problem” and “the coming tech-lash.” The latter article predicted that in 2014, tech executives would “join bankers and oilmen in public demonology.”

Perhaps it’s unfair to expect tech VIPs to behave any better than other rich people. Maybe Silicon Valley ought to shed its halo willingly and accept its fate, like Wall Street or petroleum or plastics, as just another industry that makes no pretense about being anything other than what it is: a business.

But that would be an unmitigated disaster. Allowing the love affair with Silicon Valley to die wouldn’t just kill its public image; it would decimate the industry itself.

Why Silicon Valley Can’t Afford to Ignore the Haters

Silicon Valley is always selling the next category, the new frontier, the thing you’ll need tomorrow but can’t even imagine wanting today. A computer in your home. The Internet in your pocket. Your music in the cloud. A smartphone on your wrist or face.

For decades now, the Valley has asked customers to break routines, to risk ridicule and pay handsomely for the privilege. Unlike any other industry, tech relies on not merely trust but faith that a leap into the unknown will be rewarded.

That’s why the recent arrogance of Silicon Valley honchos has been not just poisonous but deluded. One of the most toxic memes to waft out of the industry recently has been the idea of quasi-secession, whether it was Peter Thiel’s dream of floating hacker communities or Tim Draper’s plan to make Silicon Valley its own state or Balaji Srinivasan’s vision of an “ultimate exit” to someplace where engineers could build a world “run by technology.” But they’ve got it entirely backward. People don’t crave technology like drugs, wanting it so bad they’ll wire bitcoins to the offshore plutocracy of Libertaristan just to get it. They adopt technology when they’re seduced by the communities that grow up around it, often for love rather than money. If inventing new modes of communication or collaboration was seen as a mercenary act—as no nobler than drilling a well or devising a mortgage-backed security—then such platforms would never thrive, because their value tends to arise from a long, slow, unprofitable process of experimentation.

If anything, the public love affair with Silicon Valley is more crucial today than ever.

There’s a reason why web giants adopt slogans like “Don’t be evil” or endorse “the Hacker Way” : The entire business models of Google and Facebook are built not on a physical product or even a service but on monetizing data that users freely supply. Were either company to lose the trust and optimism of its customers, it wouldn’t just be akin to ExxonMobil failing to sell oil or Dow Chemical to sell plastic; it would be like failing to drill oil, to make plastic.

When William Gibson envisioned cyberspace as a “consensual hallucination,” he was right. Unsettle the consensus about the social web and you don’t just risk slowing its growth or depopulating it slightly. You risk ending it, as mistrust of corporate motives festers into cynicism about the entire project.

Allowing the love affair with Silicon Valley to die wouldn’t just kill its public image; it would decimate the industry itself.

In advancing their case that Silicon Valley’s profits only benefit the few, critics often note the structural advantage of tech companies, which allows them to build massive businesses with tiny workforces. (In December, Twitter flirted with a valuation of $50 billion despite having just 2,300 employees, while Dow Chemical, worth a similar amount, supported more than 23 times as many jobs.)

But it might turn out that there’s a corresponding disadvantage—or perhaps we should call it an obligation, if not moral then practical. Compared with Wall Street or petroleum, Silicon Valley might need to spend a far greater share of its treasure to maintain a general faith in its good intentions. It might need to wade more deeply into politics, not to secure tax breaks for itself but to force the development of affordable housing and transit in the Bay Area and beyond, so its neighbors don’t lose when it wins.

It might need to regard its special status in the American imagination as a sacred trust, without which it might not survive, let alone thrive. Otherwise, like a plastics executive watching The Graduate, Silicon Valley might soon discover that it has become a punch line—a hallucination of a future that no one believes in anymore.

Affordable-housing advocates block a Google shuttle bus to the Valley in December 2013. Stephen Rhodes/Getty Images; Color by Gluekit